Britain will continue to face tough economic times despite an improvement in latest financial figures, it has been warned. The country's economy grew by 0.5% between September and October in a rebound from a 0.6% contraction the previous month, according to the Office for National Statistics (ONS).
But Chancellor Jeremy Hunt warned of a “tough road ahead” after the figures were released. He said: “High inflation, exacerbated by Putin’s illegal war, is slowing growth across the world, with the IMF predicting a third of the world economy will be in recession this year or next.
“While today’s figures show some growth, I want to be honest that there is a tough road ahead. Like the rest of Europe, we are not immune from the aftershocks of Covid-19, Putin’s war and high global gas prices.
“Our plan has restored economic stability and will help drive down inflation next year, but also lay the foundations for long-term growth through continued record investment in new infrastructure, science and innovation.”
According to the ONS figures gross domestic product (GDP) grew by a bigger-than-expected 0.5% between September and October in a bounce back from a 0.6% contraction the previous month. The rebound marked the biggest expansion since November 2021 and was more than the 0.4% rise expected by most economists.
It comes after September was affected by the lower number of working days due to the additional bank holiday for the Queen’s state funeral, and experts said the bigger picture is still one of a shrinking economy amid the cost-of-living crisis, with the UK set to suffer a prolonged recession. The ONS said the three months to October saw the economy drop by 0.3% compared with the previous three months.
Darren Morgan, ONS director of economic statistics, said: “The economy bounced back in October, recovering from the impact of the additional bank holiday for the state funeral. In particular, car sales rebounded after a very poor September, while the health sector also saw a strong month, with GP appointments, A&E attendance and the Covid-19 autumn booster campaign all driving up the sector.
“Construction continued its strong trend over the last year and stands at its highest level on record, with new housebuilding driving growth this month. However, over the last three months as a whole the economy shrank, with falls seen across services and manufacturing.”
Labour’s shadow chancellor said the figures showing the economy shrank by 0.3% in the three months to October showed the country was "lagging behind". Rachel Reeves said: “Today’s numbers underline the failure of this Tory government to grow our economy, leaving us lagging behind on the global stage.
“These are challenging economic times, but there is a choice. We can continue down the road of managed decline, falling behind our competitors, or we can draw on bold thinking to propel us forward.
“That is why Labour will make our economy stronger and get it growing, with our Green Prosperity Plan and an active partnership with business.”
The ONS said Britain’s economy grew by 0.5% between September and October in a rebound from a 0.6% contraction the previous month.
